When Apple released iOS 4 in June, it came with a new advertising system, called iAd, that it developed after. The early reviews from developers interviewed by CNET about the iAd platform are positive.
"When we looked at iAds, the experience and execution is in line with how we feel about brand advertising--communicate without interrupting the user," Shravan Goli, president of Dictionary.com, told CNET. "That makes the iAds really remarkable."
Before iAds, when an ad was clicked from an app, the user would be taken out of the app and into a Web browser or the App Store and shown the product that was being advertised. iAds keeps the user in the app.
When, CEO Steve Jobs described it as a mix of emotion and interactivity, which he said is something current ad platforms weren't providing to users. iAds are interactive and include video and other rich media. Users don't always like video in their advertisements, but its been working well so far for at some developers.
Jonathan L. Zweig, for example, is CEO of Jirbo, which has 197 apps in the App Store, including the popular "Type n Talk." Zweig said the CPM (cost per thousand impressions) and click-throughs on the iAds are very high.
Dictionary.com's Goli said the eCPM (effective cost per thousand impressions) for his products went up 177 percent with iAds. Goli also said that the eCPM for iAds is 246 percent higher than the other ad networks his company has tried.
Both companies cite the design and creativeness of the iAds as being very important to them and the users of their apps.
"It really has to do with beauty of the ad itself--they are very inviting," said Zweig. "There was a burnout in the past with ads, but this is changing things."
The numbers seem to support that theory. Goli said ad conversion rates on the iPhone are five to six times those of the BlackBerry for the same app.
And other networks might want to take notice and offer similar services if they want to attract developers, they said.
"iAds have definitely raised the bar for mobile and online advertising," said Goli. "How you combine all of the elements and create the ads within the context of the app is very important. Other networks will have to think very hard about what Apple is doing."